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Use a card, lose your privacy?

A prescription drug discount company insists that one of its parent firms, a marketing company, won't sell your personal info if you use its drugstore card. But its legal language suggests otherwise.

David Lazarus

9:32 PM EDT, July 25, 2013

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"Good news — you've been accepted!" the letter says. "Get up to 75% off when you use these free cards at your favorite pharmacy!"

Enclosed are two plastic cards from National Prescription Savings Network that include personal "member identification numbers" and the pledge that "you will not be turned down for a pre-existing condition."

The cards are "pre-activated and ready to use immediately," the letter says. "They entitle you — and every member of your family — to discounts on every FDA-approved prescription medication sold at pharmacies everywhere in the United States."

A sweet deal, right? When a colleague shared the letter and cards he'd received, my first reaction was that there had to be a sneaky catch.

But when I stopped in at both a CVS and a Walgreens branch to ask the pharmacists what they knew of the program, I was told that the cards apparently work, though it may be a stretch to expect a 75% discount.

The pharmacists said they see various discount cards, which typically provide a price reduction that's less than what you'd get with insurance but about 10% off the full retail price. In other words, they could be helpful for the 50 million people without health coverage.

So what is National Prescription Savings Network and how does it do what it does?

Answering those questions, I discovered, raised a host of new questions that should give any consumer pause before using these cards.

First of all, good luck getting these guys on the phone. When I called the number for National Prescription Savings Network given on the letter and the different number on the company's website, I heard a lengthy recording that detailed the workings of the program.

National Prescription Savings Network's card works like a coupon, the recording said. "We will never sell or share your personal information with anyone," it said.

To speak with a customer service rep, you're prompted at the end of the recording to press 7. Both times I did so, the call was immediately disconnected.

The letter to card recipients includes an address in Overland Park, Kan. The address is that of a business park with a variety of tenants in the building.

Dan Strausbaugh, a lawyer who said he's had an office there for more than 10 years, checked the building's directory for me. He said there's no listing for National Prescription Savings Network.

The website for National Prescription Savings Network includes a link at the very bottom to a New York company called ScriptRelief, which also offers discount cards.

Ed McCabe, a spokesman for ScriptRelief, told me the two companies are one and the same.

He said ScriptRelief operates under a variety of names, including National Prescription Savings Network, U.S. Prescription Discounts, RxRelief and HelpRx. Additional names, he said, are being developed.

"In order to maximize market share, we're always looking for brands that resonate with different groups of people," McCabe explained.

One brand that you won't find on the websites of ScriptRelief or its various aliases is Loeb Enterprises. That's the New York marketing company that co-owns ScriptRelief with a company called Catamaran, which specializes in negotiating drug prices with pharmacies.

Loeb Enterprises and ScriptRelief, according to their websites, share the same Fifth Avenue address.

McCabe, a former Loeb Enterprises executive, said the Kansas address used by National Prescription Savings Network actually belongs to an affiliate of Catamaran named InPharmative. He said InPharmative forwards mail to ScriptRelief's New York office.

ScriptRelief makes its money by receiving "a few dollars" from drugstores for every transaction involving its cards, McCabe said. Pharmacies apparently are betting that they'll still come out ahead by getting new customers through the door.

McCabe insisted that even though ScriptRelief is co-owned by a marketing company, it doesn't sell or share card users' personal information. "That's absolutely not how we make money," he said.

The ScriptRelief privacy policy, however, tells a different story. It says that "we may share your information with other companies whose products and services may be of interest to you."

"We may share your information with our other businesses and affiliated companies," it also says. "We may combine the information that we collect from you with information that you provide to us in connection with your use of our other products, services and websites, or information we collect from third parties."

I pointed this out to McCabe. He said the privacy-policy language was there just for legal reasons.

So take your choice: You can believe the assurances of a company spokesman that your privacy is safe. Or you can believe what's laid out in a legally binding contract that your personal info can be shared at any time.

As best as I can tell, these prescription discount cards aren't a scam, though it seems unlikely you'll get as large a discount as promised. If you have insurance, I'd stick with that. If not, such cards may be worth a try.

But keep in mind that these cards are being offered by a marketing company, and that company has gone to elaborate lengths to keep you from knowing of its existence or what it may do with your information.

There is an unattributed quote prominently featured on Loeb's website. It says:

"A hidden connection is stronger than an obvious one."

The quote is from Heraclitus of Ephesus, an ancient Greek philosopher. I'm not exactly sure what it means.

But I take it as a warning.

David Lazarus' column runs Tuesdays and Fridays. he also can be seen daily on KTLA-TV Channel 5 and followed on Twitter @Davidlaz. Send your tips or feedback to david.lazarus@latimes.com.